In an attempt to decide between buying third-party capacity orbuilding the facilities to generate the capacity itself, FloridaPower Corp. issued an RFP yesterday, seeking bids from companiesinterested in generating 530 MW for the electric company beginningin Nov. 2003.

“We need generating capacity we can count on. This new capacitywill either be owned by or contractually committed to utilitiesserving the customers of Florida,” said Joe Richardson, FloridaPower president and CEO.

Richardson said that Florida Power “has a legitimate self-buildoption in Hines 2 that will meet the needs of our customers, but inorder to be sure our customers’ best interests are indeed served,we will seek outside bids to provide the additional capacity andevaluate all viable options. Bids received from qualified bidderswill be compared with the Hines 2 option on location, price,dispatchability, flexibility and reliability of the power offered,he added. The estimated total direct cost is $197.6 million.Construction has not begun yet.

The Florida Public Service Commission (FPSC) recently gaveunanimous approval to increase from 15% to 20% the level of”reserve” electric generating capacity that utilities operating inthe state are required to have. The new planning criteria ensurethat there will be a 20% reserve margin among the state’s threemajor investor-owned utilities by the summer of 2004. Reservecapacity is necessary to ensure continued reliable service evenwhen electric demand is very high, such as on a cold winter morningor a hot summer afternoon.

In response, Florida Power will accelerate the construction ofits planned Hines 2 unit, which is already part of the company’s10-year generation expansion plan, or procure dedicated generationfrom another source. Hines 2 would be a 530 MW sister unit to thealready operating Hines 1 unit at Florida Power’s Hines EnergyComplex in Polk County.

Respondents interested in submitting proposals under thissolicitation will be required to provide notice of intent to bid by5 p.m. Feb. 10. For more information call (727) 826-4387.

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